In 1972, the then Chinese and Australian leaders – chairman Mao Zedong and premier Zhou Enlai; and prime minister Gough Whitlam – with great political wisdom and strategic courage, made the significant decision to open diplomatic relations between their two countries.

In the past 40 years, our relations have withstood the test of the changing international situation and achieved historic progress.

We have frequent exchanges at leadership and other levels. Our leaders visit each other or meet at multilateral settings every year.

Exchanges between parliaments, political parties, militaries and localities are vibrant.

There are over 10 bilateral dialogue mechanisms such as the strategic dialogue, economic dialogue and defence consultations, all of which are productive.

Our countries have maintained sound consultation and co-ordination in the United Nations, G20, East Asia Summit and other multilateral mechanisms.

China and Australia are more interdependent than ever. In 40 years, two-way trade volume jumped from $US100 million to $US116.6 billion – up 1300 times.

China is Australia’s largest trading partner, export market and source of imports, while Australia is China’s seventh-largest trading partner and an important supplier of resources and energy.

People-to-people and cultural exchanges have grown robustly.

In 1972, there were no Chinese students in Australia and fewer than 500 two-way visitors. Today, about 160,000 Chinese study in Australia and 1.37 million visitors travel between the two countries annually. We have 81 pairs of sister states and cities and our first reciprocal “Years of Culture” was a resounding success.

For 40 years, China-Australia relations have braved the waves and spiralled upwards.

As the Chinese saying goes: One shall have no doubt at the age of 40.

So what is the legacy of the maturing China-Australia relations? What is the inspiration for the future?

First, foresight and vision hold the key to the development of China-Australia relations.

Forty years ago, it was with foresight and vision that our older generation of leadership normalised bilateral relations.

Today, in the face of deepening globalisation and regional integration, so long as we view and approach our relations from a broad strategic perspective, and firmly bear in mind the fundamental interests of our peoples, we will be able to keep China-Australia relations on the right track of development.

No matter how we frame our relationship, its strategic significance is beyond any doubt.

Second, win-win co-operation is the bedrock for the development of China-Australia relations.

The two nations are highly complimentary in industrial structure and natural reserves. That makes us natural partners for mutually beneficial co-operation.

A quarter of Australia’s exports go to China. Demand and investments from China have driven a boom in Australia’s mining and other sectors, pushing per capita income up 30 per cent.

Bilateral co-operation has lent a strong support to our respective economic and social development, and brought tangible benefits to the two peoples.

In the long run, economic and investment relations between China and Australia have clear strategic value.

Our investment co-operation needs to be diversified and extended from the traditional energy and resources area into agriculture, environmental protection, financial and monetary services, tourism and infrastructure development.

Third, mutual understanding provides enabling conditions for the development of China-Australia relations.

Only when we engage in exchanges can we get to know each other. Only when we know each other well can we understand each other well.

Forty years ago, we found each other mysterious. Today, we are no longer strangers. This is because we visit each other more often.

China is Australia’s biggest source of international students and its biggest market of inbound tourists by value.

Mandarin is the second most used language in this country, only after English.

Different cultural values and development backgrounds pose no barriers to understanding. We need to think more from each other’s perspectives, and be more considerate of other’s feeling.

This is built on knowledge and understanding.

More and more Chinese people know not only Sydney and Melbourne, but also Gallipoli and the Kokoda Track, and why Perth is called the “City of Light”.

We expect the Australian people to learn more about Chinese culture and history.

If one is familiar with the wars, hunger and humiliation the Chinese people have suffered in modern history, one will better understand why they are so sensitive to sovereignty issues, cherish peace so dearly and aspire for development so strongly.

Fourth, mutual respect and trust are the prerequisites to the bilateral relationship’s development.

China and Australia are far apart geographically, with different cultures, conditions and systems.

It is impossible for us to agree on everything, but it is important that we respect each other as equals and seek common ground while shelving our differences.

We respect each other’s independent choice of path of development and try to accommodate each other’s core interests and major concerns.

We take a rational view of each other’s strategic intentions and do not see each other as rivals.

China always takes Australia as an important partner in the Asia-Pacific for comprehensive co-operation.

We are delighted that strong economic links and political mutual trust complement and reinforce each other.

The 18th National Congress of the Communist Party of China recently successfully concluded in Beijing.

It reviewed China’s development over the past decade and laid out plans for its future endeavours in all fields.

China will continue to pursue scientific development at home, deepen reform and opening-up, speed up the transformation of growth patterns, and pursue balanced, co-ordinated and sustainable development.

This will turn China into a moderately prosperous society in all respects by 2020.

On the diplomatic front, China will remain committed to the path of peaceful development and the strategy of win-win co-operation, engage in international affairs more actively, and play its due part as a responsible country.

China will stick to the policy of being a friend and partner to its neighbours, deepen mutually beneficial co-operation with them and seek development in a way that will bring more benefits to neighbouring countries.

The China Express will run more smoothly and steadily.

The Congress set a “double growth” target, namely doubling China’s 2010 GDP and per capita income by 2020.

China will also press ahead with its urbanisation drive.

All this will give China greater staying power to achieve sustained and balanced development.

During the 12th Five-Year Plan period (2011-2015), China’s total imports and direct outbound investments are expected to exceed $US10 trillion and $US500 billion respectively.

Its large market for social security, health care and high-end agricultural produce, as well as areas like innovation and science research, will open up new horizons for China-Australia co-operation.

Australia is the first developed country in the West to have published an “Asian Century” white paper.

The paper reflects Australia’s sharp strategic vision. China and Australia share broad common interests and have no conflicts of fundamental interests.

The key to even more brilliant achievements in co-operation lies in whether we can grasp long-term and fundamental interests and set the stage for China-Australia relations to reach a new strategic height.

I am convinced that in the next 40 years, China and Australia will become not only mutually beneficial business partners, but also mutually trusted good friends.